Robert J. Gaudette
Executive Vice President, President of NRG Business and Wholesale Operations at NRG Energy
Thank you, Larry. Turning to Slide 7. The power sector is undergoing a structural shift, driven by accelerating electrification, industrial expansion and the rapid scaling of AI and data centers. This transformation is exciting, it's real and it's fueling what we believe to be the start of a power demand super-cycle. NRG is uniquely positioned to capture this value. Our commercial natural gas and power platform and our development team are unlocking significant opportunities. We're pairing these capabilities with strategic partnerships to further solidify our leadership.
Over the next few slides, I'll take you through the state-of-the power markets, the advancement of our data center and large load strategy and how our portfolio is geared to benefit significantly from market tightening. Beginning on Slide 8, it is clear we've entered a new era of power demand growth. Markets that once saw only modest growth or even declines are now experiencing significant and sustained increases. All indicators point to continued acceleration in the years ahead. This surge is being driven by large-scale industrial onshoring, oil and gas expansion, the electrification of transportation and the home and an unprecedented wave of data center development.
ERCOT and PJM are at the forefront of load growth. Since November, ERCOT's large load interconnection forecast has expanded by 30%, reinforcing Texas as the nation's fastest-growing power market. With low-energy costs, a business-friendly regulatory framework and the ability to bring projects online quickly, Texas is uniquely positioned to capture this demand at-scale. PJM is also a key market, home to some of the most established data center hubs in the country with the signs of the market tightening now and into the future. The impact on supply is clear. Reserve capacity is tightening as new load comes online.
While not every new project will move forward as planned, even a fraction of this growth would significantly impact supply-demand dynamics. The structural forces driving market tightening are still taking shape and we remain in the early stages of this transformation. The companies that scale it efficiently, optimize supply and act decisively will be best-positioned to capture the opportunities ahead. We like where we stand.
Turning to Slide nine, power demand is rising as the grid becomes increasingly dependent on intermittent resources. In competitive markets, over 90% of the planned capacity additions consist of solar, wind or battery storage, while only 26 gigawatts of natural gas capacity is queued in ERCOT and 8 gigawatts of PJM. At current growth projections, this falls well short of what is needed to keep pace with accelerating demand. Compounding the issue, a large share of the projects in the queue historically never reach completion. This is a structural challenge that will not be resolved quickly.
The primary constraint is the limited availability of two essential parts of building thermal generation. First, critical components, turbines and other key equipment for new flexible natural gas generation remain in short supply with no meaningful relief expected for years to come. Second, the human components, experienced thermal development teams and EPC firms are at capacity already. While other technologies such as small modular reactors are in the new cycle, they're still in early development and unlikely to be commercially viable before 2035 at the earliest. With constraints on new dispatchable capacity and shrinking reserve margins, the value of existing flexible generation continues to grow.
Now turning to Slide 10. Last year, we discussed this with you this trend and its challenges. We formed a dedicated team spanning commercial, engineering and operations to maximize the value of our site portfolio, and we've made significant progress since then. Until now, we've discussed these sites at a high-level. Today, we're very excited to break-down how we're prioritizing them for near-term development. They fall into three categories. First, we have top-tier premium locations that are our highest priority. These are ideally positioned for front of the meter and behind-the-meter solutions and many can incorporate on-site generation, making them highly-attractive for premium long-term power agreements.
Within this top-tier group, some sites stand-out as super hosts, large-scale locations capable of supporting multiple gigawatts of data center demand, gigawatts of new dispatchable capacity and large-scale renewable resources. These are ideal for hyperscalers, offering the scale, infrastructure and market access required for major projects. We are actively engaged in discussions and they remain our primary focus for near-term execution. We believe there are over 7.5 gigawatts of opportunity across this first category of sites. Beyond this, we believe we can support another 7.5 gigawatts of capacity.
We have eight sites and are exploring greenfield options. This group offers strong opportunities, but has specific constraints that will take additional time to resolve. These are typically best-suited for medium to small data centers. In total, we see at least 15 gigawatts of potential capacity, an incredible opportunity that cements us as a leader in this space. We're already advancing the first projects and as evidenced by the announcements today, we're taking the next step to accelerate development at a speed and scale no one else can match.
Turning to Slide 11. We're announcing a landmark fully-integrated collaboration with GE Vernova and Kiwit through its subsidiary TIC, bringing together world-class turbine manufacturing, development, engineering and construction expertise and energy markets leadership to create the most advanced end-to-end joint development platform for large load energy solutions. NRG, which will own and operate the plants, brings deep energy expertise, prime development locations and a proven track-record of development execution. While GE Vernova provides best-in-class turbine technology and delivers industry-leading engineering and construction capabilities.
With planned turbine access, coordinated EP support, ready to build sites and a fully-integrated development approach, we can deliver power faster, more efficiently and with greater certainty than anyone else in the market. Speed-to-market wins. The platform is already delivering results. We have secured two slot reservation agreements with GEV for their seven HA gas turbines, supporting 1.2 gigawatts of new capacity online in 2029. This is in addition to our already announced 1.5 gigawatts of shovel-ready capacity. We are actively working with several premium data center operators for this initial capacity and of course, the additional value of our related sites. We are initially targeting 5.4 gigawatts of capacity by 2032.
Turning to Slide 12, we're also advancing our go-to-market strategy through multiple LOIs with data center developers to bring their facilities to our sites and supply power to their sites. They recognize the strategic value of our locations and our capabilities. We are strategically positioned to not only meet their long-term power needs, but also develop, build and operate on-site generation where needed. We can move with speed and certainty. Our capabilities position us to capture strong premiums on our power agreements. This premium is driven both by the strategic value of our sites and the strength, breadth and flexibility of our supply portfolio.
To quantify this, we're seeing long-term revenue rates ranging from $70 to $90 per megawatt-hour depending on-site location, structure and project attributes. We are very proud of what we announced today. Not only have we performed incredibly as a company this past year, we have moved from talking about the data center strategy to executing on it. The key takeaway is clear. We have the team, the strategy and the partnerships to lead this energy revolution. With unmatched speed, execution and market positioning, NRG will create long-term value. And this is just the beginning.
Today's announcement set the stage and we look-forward to sharing more as we continue to execute., as we turn to Slide 13, I want to highlight again another key advantage of our platform, the embedded value in our Texas generation fleet and the opportunity it presents as market conditions evolve. Our upside extends past site optimization and premium contracts. Rising power prices benefit our existing portfolio. The latest ERCOT capacity demand and reserves report confirms what we've been tracking. Market conditions are tightening rapidly. As this unfolds, our generation will create additional earnings.
Our multiyear outlook previously provided you assumed a conservative $47 per megawatt-hour for around-the-clock Texas pricing through 2029. Yet forward market pricing is already trading in the low-50s, signaling early benefits to our platform and more potential. As an example, at $60 per megawatt-hour around-the-clock, our generation portfolio would produce $590 million in additional margin on an open basis. We position our portfolio to benefit from the power demand super-cycle. NRG is bringing the capabilities of our commercial platform and the benefits of our generation portfolio, the go-to-market strategy with data center partners and the structural supply solution with GE Vernova and Keywit to solve customers' challenges and capture the value of the opportunities in front of us.
With that, thank you for your time. I'll now turn the call over to Bruce for the financial review.
